HOUSTON, TEXAS, March 16, 2005—El Paso Corporation (NYSE:EP) is providing today fourth quarter and full-year 2004 financial results for the company. The financial results presented in this release have not been audited. El Paso will file for an extension of 15 days in order to allow it and its auditor to complete documentation of its activities under the Sarbanes-Oxley Act of 2002 and to finalize the audit of the company's financial statements.

In the course of El Paso's 2004 audit process, the company and its auditor identified an issue related to the company's adoption in the first quarter of 2002 of SFAS No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets, related to the carrying value of certain of its equity investments. Although the company and its auditor are still reviewing this issue, the company's auditor has informed the company that it currently believes that the original treatment was in error. The company is currently evaluating the impact this could have on the current and prior period financial statements. The company expects that this issue will be fully resolved within the 15-day extension period ending March 31, 2005. The impact on the company's financial statements is anticipated to be no more than an additional $154-million loss in 2002 and up to an additional $70 million of net income in 2004. The impact of the original implementation of SFAS No. 141 and 142 was reported as a cumulative effect of an accounting change in the company's income statement and not in the company's income from continuing operations. This impact was non-cash, and any change would have no effect on the company's reported cash flow from operations for any period.

2004 Highlights

• The company's regulated natural gas pipeline business generated $1.3 billion of earnings before interest and taxes (EBIT) while completing its significant capital projects on time and within budget;
• The company's non-regulated production business continued its turnaround, achieving an average annual production rate of 829 million cubic feet equivalent per day (MMcfe/d) (including discontinued operations) and $734 million of EBIT;
• The company generated cash flow from operating activities of $1.3 billion, which includes discontinued operations and $626 million paid for the western energy settlement; made $1.8 billion of capital investment, primarily in its two core businesses; and paid $101 million in dividends;
• The company raised more than $3.3 billion in capital for debt reduction from asset sales; and
• The company reduced outstanding debt (net of cash) by $3.4 billion in 2004, to $17.1 billion at year end.

"In 2004, we laid the foundation for substantial progress in 2005 and beyond," said Doug Foshee, president and chief executive officer of El Paso. "We made solid progress in reducing costs, stabilizing our production business, and continuing to build our pipeline franchise. Additionally, we exceeded expectations on the timing and amount of non-core asset sales and reduced our debt, net of cash, by $3.4 billion."

Unaudited financial results for the three months and twelve months ended December 31, 2004 are as follows:

Financial Results	Three Months Ended December 31,		Twelve Months Ended December 31,
($ in millions, except per share amounts)	2004	2003	2004	2003
Net loss	$(620)	$(285)	$(1,024)	$(1,928)
Discontinued operations, net of income taxes	4	(201)	(146)	(1,396)
Cumulative effect of accounting changes, net of income taxes	-	-	-	(9)
Loss from continuing operations	$(624)	$(84)	$(878)	$(523)
Loss per share - diluted	$(.97)	$(.47)	$(1.60)	$(3.23)
Discontinued operations per share	.01	(.33)	(.23)	(2.34)
Cumulative effect of accounting changes per share, net of income taxes	-	-	-	(.02)
Loss from continuing operations per share - diluted	$(.98)	$(.14)	$(1.37)	$(.87)

Significant items that impacted the reported periods are summarized below and a complete schedule of significant items is attached to this release.

Three Months Ended December 31, 2004

For the three months ended December 31, 2004, El Paso reported a net loss of $620 million, or $.97 per diluted share, compared with a net loss of $285 million, or $.47 per diluted share, for the same period in 2003. Significant items reduced fourth quarter 2004 EBIT by $751 million and $179 million during the same period in 2003. Significant items impacting fourth quarter 2004 results were primarily related to El Paso's domestic and international power portfolio as the company recognized impairments on its Asian power assets, certain of its power contract assets, and its investment in certain domestic power assets. The company has either sold or is currently in the process of selling many of these assets.

Twelve Months Ended December 31, 2004

For the twelve months ended December 31, 2004, El Paso reported a net loss of $1,024 million, or $1.60 per diluted share, compared with a net loss of $1,928 million, or $3.23 per diluted share, for the same period in 2003. El Paso had cash flow from operating activities totaling $1.3 billion, which was reduced by a $0.6-billion payment for the company's western energy settlement. Significant items reduced 2004 EBIT by $1.2 billion and 2003 EBIT by $1.3 billion. Significant items impacting 2004 results were primarily related to the sale or planned sale of El Paso's power portfolio and costs of the company's continued restructuring activities.

Tax Rates

El Paso's tax rate for the three months and twelve months ended December 31, 2004 was significantly different than the statutory rate of 35 percent as a result of impairments on foreign investments with no corresponding U.S. tax benefit and the non-deductibility of goodwill written off due to the merger of GulfTerra Energy Partners and Enterprise Products Partners (Enterprise). The company's ongoing tax rate is expected to be 35 percent to 39 percent, and cash taxes are expected to be 5 percent or less on an ongoing basis.

Business Unit Financial Update

Pipeline Group
The Pipeline Group's EBIT for the three months ended December 31, 2004 was $355 million, compared with $359 million for the same period in 2003. Results for the fourth quarter 2004 period include significant items that increased EBIT by $6 million, compared with an increase for significant items of $13 million in fourth quarter 2003. Results in fourth quarter 2004 were unfavorably impacted by higher allocated overhead costs, lower revenue on ANR Pipeline Company's system due to the renegotiation or restructuring of contracts with We Energies as a result of competition in the Wisconsin market, and the expiration of the risk-sharing provision on El Paso Natural Gas, which provided revenue net of sharing obligation. Factors offsetting these declines include the benefit of efficient compressor fuel usage and higher equity earnings. Throughput was up from 2003 levels primarily due to the company's equity investments.

Production
The Production segment's EBIT for the three months ended December 31, 2004 was $176 million compared with $148 million for the same period in 2003. Significant items reduced fourth quarter 2004 results by $10 million, while fourth quarter 2003 results were negatively impacted by $2 million of significant items.

Fourth quarter 2004 production volumes averaged 775 million cubic feet equivalent per day, which is down 19 percent from 2003 levels. The decrease is due to declines in base production and lower capital expenditures.

The realized price for natural gas during the three months ended December 31, 2004 was $6.18 per thousand cubic feet (Mcf), compared with $4.35 per Mcf for the same period in 2003. Oil, condensate, and natural gas liquids prices were up 55 percent to $39.44 per barrel in fourth quarter 2004. Total per-unit cash costs increased to an average of $1.69 per Mcfe in fourth quarter 2004 compared with $.95 per Mcfe for the same 2003 period due to higher costs and lower production volumes. In addition, part of the 2004 increase is due to higher workover activity, which is expensed in the current period. The company's workover activity has been an important contributor to stabilizing production.

Other Non-regulated Operations

Marketing and Trading
The Marketing and Trading segment reported an EBIT loss of $85 million for the three months ended December 31, 2004 compared with a loss of $105 million for the same period in 2003, primarily due to lower expenses offset by higher losses on historical trading activity. In addition, the fourth quarter 2004 results benefited from a $53-million uplift in the value of contracts, which provide El Paso a floor price of $6.00 (put options). The company purchased these contracts in the fourth quarter of 2004 as a part of its price risk management activities for El Paso's natural gas production.

Power
El Paso's domestic and international power operations reported an EBIT loss of $600 million for the three months ended December 31, 2004 compared with a loss of $84 million for the same period in 2003. Significant items in the fourth quarter of 2004 reduced EBIT by $687 million and primarily consisted of the impairment of domestic power plants in the amount of $171 million, domestic restructuring contracts in the amount of $227 million, and certain Asian power plants in the amount of $287 million. Fourth quarter 2003 results were negatively impacted by $191 million of significant items, primarily related to impairments of domestic power plants that were sold during 2004. After considering the effects of significant items, EBIT from domestic power plant operations was lower in fourth quarter 2004 due to the sale of the majority of the company's domestic power plants. EBIT from international power operations, after considering the effects of significant items, was higher in the fourth quarter of 2004 due to improved earnings at the company's Brazilian operations. EBIT from domestic contract restructuring, after considering the effects of significant items, was $18 million lower during the fourth quarter of 2004 primarily due to the sale of Utility Contract Funding and Mohawk River Funding IV.

Field Services
The Field Services segment reported an EBIT loss of $4 million for the three months ended December 31, 2004 compared with EBIT of $130 million for the same 2003 period. Significant items in the fourth quarter of 2004 reduced EBIT by $4 million. Significant items in the fourth quarter of 2003, which increased EBIT by $85 million, primarily related to a gain on the sale of interests in GulfTerra. After considering the effects of significant items, EBIT was lower than a year ago due to asset sales.

The earnings contribution from Enterprise/GulfTerra decreased to $6 million for the fourth quarter of 2004 from $42 million for the fourth quarter of 2003 as a result of the sale of substantially all of the company's remaining interests in GulfTerra to Enterprise in September 2004. Cash distributions from Enterprise/GulfTerra totaled $7 million for the fourth quarter of 2004 compared with $37 million for the fourth quarter of 2003.

Detailed operating statistics for each of El Paso's businesses will be posted at www.elpaso.com in the Investors section.

Internal Control Over Financial Reporting

In 2004, the company reported a number of material weaknesses in its internal controls and has devoted considerable effort to make improvements in its internal controls in order to comply with the Sarbanes-Oxley Act of 2002. The company has assessed the effectiveness of its internal control over financial reporting as of December 31, 2004. In making this assessment, El Paso used the criteria set forth in the Committee of Sponsoring Organizations of Treadway Commission's (COSO) Internal Control - Integrated Framework. A material weakness is a control deficiency, or combination of control deficiencies, that result in a more than remote likelihood that a material misstatement of the annual or interim financial statements would not be prevented or detected. The company continues to evaluate the effectiveness of its internal controls, which may result in the identification of additional material weaknesses. Based on the material weaknesses described below, management has concluded that it will issue a report which concludes that at December 31, 2004, the company did not maintain effective internal control over financial reporting. El Paso expects that its independent registered public accounting firm will issue a report which also says that the company did not maintain effective internal control over financial reporting at December 31, 2004.

As of December 31, 2004, El Paso did not maintain effective internal controls over access to application programs and data. Specifically, the company identified control deficiencies with respect to (1) inadequate design of its security access procedures related to identification of conflicting roles, (2) lack of compliance with its access security policies and (3) a lack of independent monitoring of access to various systems by IT and financial reporting and accounting staff. Additionally, the company did not maintain effective internal controls related to its account reconciliation process, especially with regard to non-routine activities, and did not maintain effective internal controls related to identification, capture and validation of pertinent information necessary to ensure the timely and accurate recording of non-routine activities, primarily related to the divestiture of assets in the businesses the company has been exiting.

El Paso has already implemented various steps to correct many of these deficiencies. The company has identified and is in the process of implementing many of the remaining steps to remediate these weaknesses.

Annual Analyst Meeting Webcast Reminder

El Paso Corporation has scheduled a live webcast of its annual analyst meeting on March 17, 2005 beginning at 9:30 a.m. Eastern Time, 8:30 a.m. Central Time, which may be accessed online through El Paso's Web site at www.elpaso.com in the Investors section. During the webcast, management will refer to slides that will be posted on the Web site. The slides will be available two hours before the webcast and can be accessed in the Investors section.

The webcast replay will be available online through the Web site in the Investors section. If you have any questions regarding this procedure, please contact Margie Fox at (713) 420-2903.

Disclosure of Non-GAAP Financial Measures

The SEC's Regulation G applies to any public disclosure or release of material information that includes a non-GAAP financial measure. In the event of such a disclosure or release, Regulation G requires (i) the presentation of the most directly comparable financial measure calculated and presented in accordance with GAAP and (ii) a reconciliation of the differences between the non-GAAP financial measure presented and the most directly comparable financial measure calculated and presented in accordance with GAAP. The required presentations and reconciliations are attached. Additional detail regarding non-GAAP financial measures can be reviewed in El Paso's full operating statistics which will be posted at www.elpaso.com in the Investors section.

El Paso uses the non-GAAP financial measure "earnings before interest expense and income taxes" or "EBIT" to assess the operating results and effectiveness of the company and its business segments. The company defines EBIT as net income (loss) adjusted for (i) items that do not impact its income (loss) from continuing operations, such as extraordinary items, discontinued operations, and the impact of accounting changes; (ii) income taxes; (iii) interest and debt expense; and (iv) distributions on preferred interests of consolidated subsidiaries. The company excludes interest and debt expense and distributions on preferred interests of consolidated subsidiaries so that investors may evaluate the company's operating results without regard to its financing methods or capital structure. El Paso's business operations consist of both consolidated businesses as well as substantial investments in unconsolidated affiliates. As a result, the company believes that EBIT, which includes the results of both these consolidated and unconsolidated operations, is useful to its investors because it allows them to evaluate more effectively the performance of all of El Paso's businesses and investments.

El Paso believes that the non-GAAP financial measures described above are also useful to investors because these measurements are used by many companies in the industry as a measurement of operating and financial performance and are commonly employed by financial analysts and others to evaluate the operating and financial performance of the company and its business segments and to compare the operating and financial performance of the company and its business segments with the performance of other companies within the industry.

These non-GAAP financial measures may not be comparable to similarly titled measurements used by other companies and should not be used as a substitute for net income, earnings per share or other GAAP operating measurements.

El Paso Corporation provides natural gas and related energy products in a safe, efficient, dependable manner. The company owns North America's largest natural gas pipeline system and one of North America's largest independent natural gas producers. For more information, visit www.elpaso.com.

View the attached tables of financial information by clicking here.

View the attached table of operating statistics by clicking here.
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This release includes forward-looking statements and projections, made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The company has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release, including, without limitation, changes in unaudited and/or unreviewed financial information; our ability to file our annual report on Form 10-K by March 31, 2005; the extent and timing of any restatement of financial statements; our ability to implement and achieve our objectives in the long-range plan, including achieving our debt-reduction targets; changes in reserve estimates based upon internal and third-party reserve analyses; our ability to meet production volume targets in our Production segment; uncertainties and potential consequences associated with the outcome of governmental investigations, including, without limitation, those related to the reserve revisions and natural gas hedge transactions; outcome of litigation, including shareholder derivative and class actions related to reserve revisions and restatements; our ability to comply with the covenants in our various financing documents; our ability to obtain necessary governmental approvals for proposed pipeline projects and our ability to successfully construct and operate such projects; the risks associated with recontracting of transportation commitments by our pipelines; regulatory uncertainties associated with pipeline rate cases; actions by the credit rating agencies; the successful close of our financing transactions; our ability to successfully exit the energy trading business; our ability to close our announced asset sales on a timely basis; changes in commodity prices for oil, natural gas, and power; inability to realize anticipated synergies and cost savings associated with restructurings and divestitures on a timely basis; general economic and weather conditions in geographic regions or markets served by the company and its affiliates, or where operations of the company and its affiliates are located; the uncertainties associated with governmental regulation; political and currency risks associated with international operations of the company and its affiliates; competition; and other factors described in the company's (and its affiliates') Securities and Exchange Commission filings. While the company makes these statements and projections in good faith, neither the company nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. The company assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by the company, whether as a result of new information, future events, or otherwise.